Home » General » Zanu-PF Hawks Eye U.S$500 Milion NRZ Loan

LOAN facility to the tune of US$500 million being negotiated between the Development Bank of Southern Africa (DBSA) and the troubled National Railways of Zimbabwe (NRZ) has been mired in controversy amid indications that State bureaucrats are rubbing their hands in glee as they hope to corruptly benefit from the deal.

The NRZ is teetering on the verge of collapse owing to years of mismanagement.

To get its act together again, the parastatal is locked in delicate negotiations with DBSA for a US$500 million bailout package.

The Financial Gazette can, however, reveal that the conclusion of the mega transaction has been met with challenges as some State actors are demanding that the South African development lender release the pledged funding direct into government coffers instead of Spoornet, who are the agreed development partners.

Spoornet, now Transnet Frei-ght Rail, is a South African rail transport company, which is headquartered in Johannesburg.

In terms of the agreement, only US$30 million should be given directly to NRZ to meet operational costs.

Insiders at NRZ said the demands now pose the only stumbling block to the finalisation of the deal amid suspicions that those frustrating the negotiations could be attempting to extract bribes or “facilitation fees”, at the expense of the struggling NRZ, which is desperate for lifelines.

Contacted for comment this week DBSA declined to be drawn into the imbroglio, referring all questions to the NRZ.

“We wish to aise that all the questions you have raised with the Development Bank of Southern Africa can be answered directly by our client, the National Railways of Zimbabwe. May I therefore kindly request that you contact NRZ directly,” said a spokesperson for DBSA.

While officials from the NRZ were not immediately available for comment, Transport and Infrastructural Development Minister, Obert Mpofu, recently hinted in Parliament that there could be some problems with the DBSA deal.

He told lawmakers recently that while negotiations with DBSA were still underway, government was also looking elsewhere for other possible suitors because the DBSA loan cost was on the high side.

Asked by the Financial Gazette to comment on the latest impediments frustrating the negotiations, Mpofu denied that government officials were poking their nose into the deal.

“I don’t know what you are talking about,” he said.

“NRZ is (still) negotiating with DBSA for a loan for rehabilitation of the entire railway system. Unless you are talking about other initiatives elsewhere which we are not privy to.”

A member of the NRZ Workers Committee however, also confided in this paper that a high-ranking government official had told them that certain State actors were putting their own interests ahead of those of the NRZ and government.

“We understand the agreement with DBSA was very clear that part of the rehabilitation programme of the NRZ infrastructure would be done through working with Spoornet of South Africa. … ..(name withheld) told us that the DBSA was now being asked to give money to the government so that some of the equipment required would be procured from China. That is where DBSA has raised red flags and wants this issue sorted out before it can start releasing the said package,” said the source.

NRZ has been weighed down by ballooning debts. It owes its employees more than US$55 million in wage arrears over and above the millions of dollars it owes other institutions.

The parastatal requires about US$1,9 billion in the long-term to be fully revitalised and transformed into a modern rail network. newsdesk@fingaz.co.zw

Source : Financial Gazette

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